INFLATION

(James Saft is a Reuters columnist. The opinions expressed are his own)

Consumer sentiment improved in December from November on some income growth and less gloomy job conditions, a survey showed on Wednesday.

Consumer spending rose for a second straight month in November as incomes recorded their biggest gain in six months, data showed on Wednesday, boosting hopes of a self-sustaining economic recovery.

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Charles Evans, president of the Chicago Federal Reserve Bank, said on Monday he expects the U.S. economy to grow 3.0 to 3.5 percent over the next 18 months, but that low inflation will give the central bank room to keep monetary policy easy for an extended period.

Charles Evans, president of the Chicago Federal Reserve, said on Monday he expects the U.S. economy to grow 3 to 3.5 percent in 2010, but that low inflation will give the central bank room to keep monetary policy accommodative for an extended period.

The Federal Reserve on Wednesday voiced growing optimism on the U.S. economy as job losses slow, but repeated a vow to keep interest rates unusually low for an extended period.

U.S. consumer prices rose modestly last month, while new home building bounced back from an October slump, suggesting inflation is not yet a concern even as the economy's recovery moves forward.

The Federal Reserve on Wednesday seized on easing U.S. job losses to voice growing optimism on the economy's prospects, but repeated a vow to keep interest rates unusually low for an extended period.

The Federal Reserve on Wednesday voiced guarded optimism the battered U.S. job market was improving, but it repeated a vow to keep interest rates extraordinarily low for an extended period.

U.S. stocks rose on Wednesday as a benign reading on the November Consumer Price Index bolstered expectations that the Federal Reserve will keep its accommodative monetary stance to foster an economic recovery.

Stocks rose on Wednesday after data showed consumer prices did not overheat in November, quelling inflation worries, while housing data pointed to sustained recovery ahead of a Federal Reserve statement on the condition of the U.S. economy.

(Corrects figure for November housing starts to 574,000 units in paragraph 8)

The Federal Reserve is expected to stick to its highly accommodative monetary policy when it wraps up a two-day meeting on Wednesday, with high unemployment constraining enthusiasm about an improving economy.

Wall Street was set to rise at the open on Wednesday after data showed consumer prices did not overheat in November, quelling inflation worries ahead of a statement from the Federal Reserve that will be scrutinized for clues on the state of the world's largest economy.

U.S. stock index futures rose on Wednesday ahead of a statement from the Federal Reserve that will be scrutinized for clues on the state of the world's largest economy.

U.S. stock index futures rose on Wednesday ahead of a statement from the Federal Reserve that will be scrutinized for clues on the state of the world's largest economy.

Stock index futures pointed to a higher open on Wall Street on Wednesday, with futures for the S&P 500 up 0.2 percent, Dow Jones futures up 0.1 percent and Nasdaq 100 futures down 0.2 percent at 0841 GMT (3:41 a.m. EST).

The U.S. Federal Reserve is expected to stick to its super loose monetary policy stance on Wednesday as high unemployment constrains policy-makers' enthusiasm about the economy's recent improvement.

Gold prices were flat at around $1,125 per ounce on Wednesday ahead of the conclusion of the U.S. Federal Reserve's two-day policy meeting, which could provide clues about the timing of interest rate moves.

Federal Reserve Chairman Ben Bernanke, in a response to a lawmaker's questions made public on Tuesday, said the U.S. economy is operating so far beneath its potential that inflation is unlikely to become a problem.